Prime, Inc., bottles and distributes mineral water from the company's natural springs in northern Oregon. Prime markets two products: 12-ounce disposable plastic bottles and 1-gallon reusable plastic containers.

1. For 2018, Prime marketing managers project monthly sales of 490,000 12 ounce bottles and 170,000 1-gallon containers. Average selling prices are estimated at $0.80 per 12 -ounce bottle and $1.60 per 1-gallon container. Prepare a revenues budget for Prime, Inc., for the year ending December 31, 2018.

2. Prime begins 2018 with 970,000 12-ounce bottles in inventory. The vice president of operations requests that 12 ounce bottles ending inventory on December 31, 2018, be no less than 650,000 bottles. Based on sales projections as budgeted previously, what is the minimum number of 12-ounce bottles Prime must produce during 2018?

The VP of operations request that ending inventory of 1 gallon containers on December 31, 2018, be 230,000 units. If the production budget calls for Prime to produce 1,900,000 1-gallon containers during 2018, what is the beginning inventory of 1-gallon containers on January 1, 2018?

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